(May 2008). On May 5, COHEAO hosted a teleconference on the new mandatory assignment regulations and what schools needs to know. Mandatory assignment is expanded by a new Education Department regulation scheduled to take effect July 1, unless the law is changed by Congress.

Panelists included Ellen Harris-Small, Assistant Manager of the Office of Billing & Collections in the Department of Student Accounting Services at Rutgers University. She provided helpful information in solving problem accounts and their acceptability by the Department of Education. Lori Hartung, Regional Sales Manager with Todd, Bremer & Lawson, Inc., provided information on current and new regulations, how to prepare your portfolio and how to assign loans.

Staff from the Department of Education also participated in the call. Brian Smith and Shirley Wheeler presented information on how they plan to implement the new regulation. Smith and Wheeler announced that when this regulation takes effect they plan to implement the regulation starting with a pilot group of 10 - 15 schools. ED plans to work one-on-one with these schools in order to get a better understanding of how the process will work and to weed out any problems they may incur when dealing with a larger group of schools. The Department is also working on putting together an “Assignment Update” package for schools.

Wheeler noted that the Department is looking at pursuing loans in default greater than 10 years. These are the loans with the largest volume and ED plans to start there even though the regulations require assignment of loans in default seven or more years – that is just a minimum requirement according to Smith. Smith also noted that the House Higher Education reauthorization bill includes language limiting the Department’s authority to collect these loans. He stated that if this provision is accepted in the conference agreement, ED would need to reassess their mandatory assignment procedures.

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